Dutchess County tax on home energy sources goes into effect Saturday

POUGHKEEPSIE >> Beginning Saturday, it will cost more for Dutchess County residents more to heat their homes, cook or do just about anything else that requires energy.

Dutchess County will begin levying its 3.75 percent county sales tax on residential energy sources on March 1. When implemented, Dutchess will be the only county in the region north of Westchester to tax energy sources.

The tax will add $3.75 to every $100 in energy costs and is expected to bring some $7.8 million in new revenue into the county’s coffers in the upcoming year. The new tax will be levied on all home energy sources, including fuel oil, propane, wood, natural gas and electricity.

Dutchess County Executive Marc Molinaro, who proposed repealing the exemption, said he is aware of the widespread opposition to the tax but that revenue from it is necessary to balance the county’s $439.3 million budget for 2014.

Molinaro said that when he took office, he was greeted with a depleted fund balance, a $40 million budget gap, significant recurring expenses — including more than $8 million in annual costs to house overflow county inmates in other counties’ jails — and state mandates that make up some 70 percent of the county’s budget.

On top of all that, he said, the state Legislature rejected the county’s request to impose a mortgage recording tax that he said would have alleviated the need to repeal the energy tax exemption.

Without imposing the energy tax, he said, the county would have been forced to eliminate 80 jobs and increase taxes by 12 percent. The 2014 spending plan adopted by county lawmakers carries a 1.97 percent increase in property taxes.

“First and foremost, this was not a decision we wanted to make, it is not one we made lightly, and we will use the burden of this to continue to find ways to reduce spending and ultimately rescind the tax,” Molinaro said.

“I don’t like it, and I know how people have to struggle,” he said. “I have lived that experience.”

County Legislator Joel Tyner, one of the most outspoken opponents of taxing energy sources, said the tax is going to hurt those who already are struggling. He also said the county has at its disposal a number of measures that could eliminate the need to tax heating fuel and electricity, including allowing county employees to buy prescription drugs from Canada, installing solar panels on county buildings, expanding the county’s alternatives-to-incarceration programs and adopting a “living wage” law that would require big-box stores to pay its employees higher salaries.

“People are barely making ends meet now,” said Tyner, D-Clinton. “If the Republicans wanted to push people to the limit, to the point of rebellion, they have.”

Republicans who control the county Legislature have said many of Tyner’s proposals are unrealistic. Others, such as proposals to reduce the county jail population, will be part of the county’s plans for a new jail.

About the Author

Since 1990, Patricia Doxsey has been a reporter for the Freeman, covering politics, crime, and government affairs. Reach the author at pdoxsey@freemanonline.com
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